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Dave, Mike, Cyril, and Moocher are working-class friends living in the college town of Bloomington, Indiana. Now turning 19, they all graduated from high school the year before and are not sure what to do with their lives. They spend much of their time together swimming in an old abandoned water-filled quarry. They sometimes clash with the more affluent Indiana University students in their hometown, who habitually refer to them as "cutters", a derogatory term for locals related to the local Indiana limestone industry and the stonecutters who worked the quarries. (The term "cutters" was invented for the movie, because the real name "stoners” was deemed unusable because of its perceived link to marijuana.[7])

Dave is obsessed with competitive bicycle racing, and Italian racers in particular, because he recently won a Masi bicycle. His down-to-earth father Ray, a former stonecutter who now operates his own used car business (sometimes unethically), is puzzled and exasperated by his son's love of Italian music and culture, which Dave associates with cycling. However, his mother Evelyn is more understanding and prepares Italian dishes for him.

Dave develops a crush on a university student named Katherine and masquerades as an Italian exchange student in order to romance her. One evening, he serenades "Katerina" outside her sorority house (Friedrich von Flotow's aria "M' Apparì Tutt' Amor"), with Cyril providing guitar accompaniment. When her boyfriend Rod finds out, he and some of his fraternity brothers beat Cyril up, mistaking him for Dave. Though Cyril wants no trouble, Mike insists on tracking down Rod and starting a brawl. The university president (real-life then President Dr. John W. Ryan) reprimands the students for their arrogance toward the "cutters" and, over their objections, invites the latter to participate in the annual Indiana University Little 500 race.

When a professional Italian cycling team comes to town for a race, Dave is thrilled to be competing with them. However, the Italians become irked when Dave is able to keep up with them. One of them jams a tire pump in Dave's wheel, causing him to crash, which leaves him disillusioned. He subsequently confesses his deception to Katherine, who is heartbroken.

Dave's friends persuade him to join them in forming a cycling team for the Little 500. Dave's parents provide T-shirts with the name "Cutters" on them. Ray privately tells his son how, when he was a young stonecutter, he was proud to help provide the material to construct the university, yet he never felt comfortable on campus. Later, Dave runs into Katherine, who is leaving for a job in Chicago; they patch things up.

Dave is so much better than the other competitors in the Little 500 that, while the college teams switch cyclists every few laps, he rides without a break and builds up a big lead. However, he is injured in a crash and has to stop. After some hesitation, Moocher, Cyril, and Mike take turns pedaling, but soon the Cutters' lead vanishes. Finally Dave has them tape his feet to the pedals and starts to make up lost ground; he overtakes Rod, the current rider for the favored fraternity team, on the last lap and wins.

Ray is proud of his son's accomplishment and takes to riding a bicycle himself. Dave later enrolls at the university, where he meets a pretty French student. Soon, he is extolling to her the virtues of the Tour de France and French cyclists.

The Little 500 bicycle race that forms the centerpiece of the plot is a real race held annually at Indiana University. A reenactment of the race was staged for the film in the "old" Memorial Stadium on the IU campus, which was demolished in 1982, four years after Breaking Away was shot.[citation needed]

The team is based on the 1962 Phi Kappa Psi Little 500 champions, which featured legendary rider and Italian enthusiast Dave Blase, who provided screenwriter and fellow Phi Kappa Psi team member Steve Tesich the inspiration for the main character in the movie.[8] Blase, together with team manager Bob Stohler, provided the name of this character: Dave Stoller.[9] In the 1962 race, Blase rode one hundred thirty-nine out of two hundred laps[8] and was the victory rider crossing the finish line, much like the main character in the film. Blase himself appears in the movie as the race announcer.[10]

Dave's "ecstasy ride" on the wooded road after first meeting Kathy (where his bike tire blew) was filmed on the "West Gate Road" in Indiana's Brown County State Park, 14 miles (23 km) east of Bloomington on State Road 46.

Two other scenes were filmed on W. 7th St.: one at Fairview Elementary, the other three blocks east near the intersection of W. 7th St. and N. Madison (the old railroad tracks have since been removed). A scene in which Dave runs a red light in front of his father was filmed at the southwest corner of the Monroe County Courthouse, at the intersection of College St. and W. Kirkwood Ave. (a few seconds before he runs it, the light is visible as he rides by the courthouse and sees Moocher and Nancy). The starting-line scene of the "Cinzano 100" bicycle race was at the intersection of Indiana State Roads 46 and 446 on the city's eastern edge.

The abandoned limestone quarry where Dave and his friends swam is on private property in Perry Township south of Bloomington. It is located at the end of East Empire Mill Road off old State Road 37 and is illegal for visitors to trespass. Rooftop Quarry, as it is referred to locally, was originally known as Sanders Quarry or The Long Hole. Access to the quarry has been made difficult by its owners, Indiana Limestone Company, to discourage people from swimming and jumping into the quarry citing safety concerns.[12]

The used car lot ("Campus Cars") that Dave's father owns was on S. Walnut St., and was a real used car lot for many years, but now has two small commercial buildings on the property; it is located at 1010 S. Walnut St. Next door is the local Honda motorcycle franchise seen in the background of the "Refund? REFUND??" scene; it remains there today.

The film received positive reviews upon its release. Roger Ebert called it "a wonderfully sunny, funny, goofy, intelligent movie that makes you feel about as good as any movie in a long time. It is, in fact, a treasure ... Movies like this are hardly ever made at all; when they're made this well, they're precious cinematic miracles."[13]The New York Times's Janet Maslin wrote that, even though "the cast is unknown, the director has a spotty history, and the basic premise falls into this year's most hackneyed category ... the finished product is wonderful. Here is a movie so fresh and funny it didn't even need a big budget or a pedigree."[11] The Variety magazine review concluded that "though its plot wins no points for originality, Breaking Away is a thoroughly delightful light comedy, lifted by fine performances from Dennis Christopher and Paul Dooley."[14] Critic Dave Kehr, however, gave a later, somewhat dissenting opinion: "Released at a time when any small-scale film earned critical favor simply by virtue of its unpretentiousness, Breaking Away probably looked better in context than it does now."[15] However, he conceded that "Peter Yates lends the film a fine, unexpected limpidity, and the principals are mostly excellent."[15]Breaking Away currently holds a 94% rating on Rotten Tomatoes based on 35 reviews, with the consensus; "At once a touching, funny coming-of-age story and a compelling sports film, Breaking Away is a delightful treat." [16]
The film is used to highlight one of "The Rules" for cyclists (i.e. Rule 43 Don't be a Jackass): "Remember when the Italian pro team came to town to race and Dave, in his exuberance, was able to ride with them in the front while speaking their native language? [...T]he Italian rider jam[s] a frame mounted pump into Dave's front wheel, causing him to crash out. That guy was a jackass. And he wasn't even funny. [...] Don't be a jackass."[17]

The 1992 Bollywood film Jo Jeeta Wohi Sikandar, starring Aamir Khan, has certain similarities to Breaking Away. However, the director Mansoor Khan stated that he only became aware of Breaking Away after the likeness was brought to his attention. Both films have several thematic similarities, including friendship, class barriers, bicycle racing, and parental relationship, but are distinctly different films, with different narratives, characters, motivations, treatment and racing rules.[25]